Hoechst Trevira plans to delay a major expansion of its Mexican PET facility and probably will not meet its previously announced plans to have 2.8 billion pounds of capacity worldwide by 2000.
Low resin prices have pushed the company to delay a new production line at its Querétaro, Mexico, facility from mid-1997 to early 1998, and to rethink how quickly it will add more lines, said Ed Hackman, Trevira's general manager for polyester polymers.
Two other 200 million-pound-line expansions, at Millhaven, Ontario, and Offenbach, Germany, are on schedule, he said. The Canadian line began running the week of March 24; the German plant is to open in July.
The Mexican plant will have a capacity of 130 million pounds, but could grow to 200 million pounds, Hackman said. A company spokeswoman called the decision ``more of a slowdown than a curtailment.''
Hackman said Trevira previously thought that after it finished those three lines it would build another next year, but ``it would be slower now.'' The firm may look at scaling back its least-productive plants, but no decisions have been made, he said.
Prices will need to rise to 55 cents a pound before the company rethinks its slowdown strategy, he said. Prices are currently at 43-48 cents.
``Certainly if pricing stays where it is now, no rational person would put more capacity into the ground,'' Hackman said. ``With the current market situation, we are like everyone else. We are re-evaluating our strategic plan, but not our commitment.''
Company officials could provide no details on how close to 2.8 billion pounds Hoechst may get by 2000, but said market analysis to 2005 indicates continued strong growth. Hoechst said late last year that the 2.8 billion-pound figure would triple its worldwide capacity.
Hoechst Trevira is the former fibers, polyester resins and films business of Hoechst AG, based in Frankfurt am Main,Germany.